Entering Pay Codes in Timecards

Pay codes, in combination with job classes, help determine the pay amounts on employees' timecards for regular and special pays. They can also be entered on timecards to account for leave and overtime. In addition, pay codes determine if an employee's pay is subject to deductions, taxes (federal, state, local, and FICA/Medicare), and Workers' Compensation.

Since pay codes are essential to timecards, you need to know the codes that are set up in your system and how they should be applied. For a report showing all of the records stored in the Pay Code table, use Print in the Pay Codes page.

This section summarizes the information stored in pay codes and outlines the effects pay codes have on an employee's pay. For related information, refer to Pay Code Table.

Enter Pay Codes

For employees on salary schedules, the pay process is fairly simple, since their pay is the same in most pay periods. If the pay groups you select during a pay run's setup include scheduled employees, you do not have to enter timecards for these employees, except for recording leave, allowances, and special pays.

However, for employees whose pay varies with some frequency, usually hourly or daily workers, you must enter the hours/days and sometimes the pay rates to enable the system to calculate their pay.

How Pay Types Affect Timecard Entry

The procedure during timecard entry depends on the pay code that applies, in particular, on the pay code's pay type. Following are the pay types used in pay codes and the entries you have to make on an employee's timecard:

Pay Types

• H - Hourly - Enter the employee's time in hours.
• D - Daily - Enter the employee's time in days.
• P - Per Period Rate - Confirm or adjust the rate for the pay period. This pay type applies to salaried employees.
• U - Per Unit Rate - Enter the number of units, for example, the number of events or services.
• S - Special Amount - Only applies to special pays. Pay codes with this pay type are not used in timecards.
• A - Timecard Amount - Enter the pay amount.

Pay codes with Hourly and Daily pay types are the pay codes entered most frequently on timecards, since they can account for both work and leave time.

Assign Pay Codes for Pay, Leave, and Other Compensation

Besides pay types, there are additional settings in pay codes that determine which codes apply for pay, leave, allowances, overtime, and other forms of compensation. These settings, known as pay time types, include:

Pay Time Types

• R - Regular Pay - Covers regular pay, holidays, paid leave and benefits. Default
• A - Allowance - Facilitates allowance pay and related W2 reporting, for example, compensation for uniforms.
• C - Compensation Earned - Allows pay for leave time that is taken as compensation for extra work time.
• E - Extended Leave - Uses a Per Unit pay type to pay for the leave and reduce the employee's leave bank.
• L - Leave Without Pay - Prevents paid leave when leave balances are depleted.
• N - Non-cash - Accounts for non-cash compensation in W2 reporting.
• O - Overtime - Enables overtime pay, usually at a higher differential, for example, time-and-a-half.

Additional Guidelines for Using Pay Codes

Following are some additional guidelines to consider regarding pay codes:

• When you press <Tab> in a timecard's blank Class field, both the job class and pay code default from the primary pay rate.
• If needed, you can select another class or pay code, provided the pay code's pay type is compatible with the primary rate's pay method:

• When you enter the job class for a secondary rate, you must enter a pay code. In this case, the rate's pay method does not affect your selection.
• If you enter a leave pay code, you must enter the employee's hours or days. Pay codes 090 through 098 are reserved for user-defined leave without pay, and pay code 099 is reserved for system-generated leave without pay.

How Pay Codes Affect Payroll Processing

During a pay run, the system references a timecard's pay codes to determine:

• The pay code's pay type, such as Hourly, Daily, or Per Period Rate.
• If the rate is for regular pay, overtime, leave without pay, and so forth.
• If the rate is subject to taxes, deductions, Workers' Compensation, and Fair Labor Standards Act (FLSA) overtime.
• Whether leave banks need to be updated.
• The account to use as an override in Fund Accounting distributions. This depends on whether the pay code includes a default account.
• Whether the pay rate includes a special pay frequency.